Essential Savings Guide for Buying a Home in Massachusetts

Briana Brookins
Dec 16, 2025
3 min read

Buying a home in Massachusetts is a major financial step that requires careful planning. Many potential buyers focus only on the down payment, but there are several other costs that you need to save for to avoid surprises. This guide breaks down the realistic savings you should have before purchasing a home in Massachusetts, helping you prepare for a smooth buying process.

Eye-level view of a traditional Massachusetts colonial house with a white picket fence — Typical Massachusetts colonial home with white picket fence

Understanding the Down Payment

The down payment is often the first cost buyers think about. In Massachusetts, the typical down payment ranges from 5% to 20% of the home's purchase price. For example, on a $400,000 home, you might need between $20,000 and $80,000 upfront.

Conventional loans usually require 10% to 20% down.
FHA loans allow down payments as low as 3.5%, but come with mortgage insurance premiums.
MassHousing loans offer affordable options for first-time buyers with down payments as low as 3%.

Keep in mind that a larger down payment can reduce your monthly mortgage payments and may help you avoid private mortgage insurance (PMI).

Closing Costs and Fees

Closing costs are often overlooked but can add up to 2% to 5% of the purchase price. These include:

Attorney fees: Massachusetts requires an attorney for real estate closings, typically costing $1,000 to $2,000.
Title insurance: Protects against ownership disputes, usually around 0.5% of the purchase price.
Home inspection: Costs between $300 and $600, essential to identify potential issues.
Appraisal fees: Lenders require appraisals, costing about $400 to $700.
Recording fees and taxes: Local government fees for recording the deed and mortgage.

For a $400,000 home, expect closing costs between $8,000 and $20,000. Budgeting for these fees prevents last-minute financial stress.

Emergency and Moving Funds

After closing, you will face additional expenses:

Moving costs: Depending on distance and services, moving can cost $1,000 to $3,000.
Repairs and upgrades: Even new homes may need immediate fixes or personalization.
Emergency fund: It’s wise to have 3 to 6 months of living expenses saved in case of unexpected events like job loss or urgent repairs.

Having these funds ready ensures you can settle into your new home without financial strain.

Property Taxes and Insurance

Massachusetts property taxes vary by city and town but average around 1% of the home’s assessed value annually. For a $400,000 home, expect about $4,000 per year.

Homeowners insurance is another ongoing cost, typically $1,000 to $1,500 annually, depending on coverage and location.

Both costs should be factored into your monthly budget when determining how much you can afford.

Monthly Mortgage Payments and Affordability

Lenders recommend that your total housing costs (mortgage, taxes, insurance) should not exceed 28% to 31% of your gross monthly income. Use online mortgage calculators to estimate payments based on different down payments and interest rates.

For example, a $400,000 home with a 20% down payment and a 6% interest rate might have a monthly mortgage payment around $1,900, plus taxes and insurance.

Saving Strategies for Massachusetts Buyers

Set a clear savings goal: Calculate your target based on down payment, closing costs, and emergency funds.
Open a dedicated savings account: Keep your home savings separate to avoid spending.
Automate savings: Set up automatic transfers to build your fund steadily.
Cut discretionary spending: Reduce non-essential expenses to boost savings.
Explore assistance programs: Massachusetts offers grants and loans for first-time buyers through programs like MassHousing and ONE Mortgage.

Final Thoughts on Preparing to Buy

Saving for a home in Massachusetts goes beyond the down payment. You need to plan for closing costs, moving expenses, property taxes, insurance, and an emergency fund. By understanding these costs and setting a realistic savings target, you can approach home buying with confidence.

Start by calculating your total expected costs based on your target home price. Then, create a savings plan that fits your income and timeline. This preparation will help you avoid surprises and make your dream of owning a home in Massachusetts a reality.